* Nissan soars as investors cover short positions - traders * Sony rises on Apple supply report * Weak machinery orders data limit overall gains - analysts By Ayai Tomisawa TOKYO, Feb 12 (Reuters) - Japan's Nikkei share average climbed to a 1-1/2 week high on Wednesday after the Federal Reserve's new chief held off from making any changes to its stimulus-reduction schedule and as a softer yen supported exporters like Canon Inc. Nissan Motor Co outperformed with traders citing short-covering after the carmaker reported earnings on Monday, while Sony Corp gained on a report that it is in talks to supply more camera sensors to Apple Inc. Analysts said the Nikkei could have risen higher but a slide in Japanese machinery orders somewhat weighed on investor sentiment. The Nikkei was up 0.5 percent at 14,796.95 in midmorning trade after touching 14,861.63, its highest since Jan. 31. It moved further away from a four-month low of 13,995.86 hit last week. Japanese markets were closed on Tuesday for a national holiday. Data on Monday showed that machinery orders, a leading indicator of capital expenditure, tumbled a much steeper-than-expected 15.7 percent in December. Still, investors were relived that Fed Chair Janet Yellen, in her first testimony to Congress, emphasised continuity in the central bank's policy strategy of cutting asset purchases by $10 billion a month. "One big reason why the Japanese market fell sharply last week was concern that the Fed may continue tapering amid a weak economy," said Masayuki Kubota, chief strategist at Rakuten Securities, adding that the market is relieved Yellen seems to have calmed such concerns by not offering any surprises. The Topix gained 1.3 percent to 1,219.41. Nissan jumped 3.6 percent to a two-week high of 917 yen, even after the carmaker reported quarterly operating profit that missed analysts' estimates and a low operating profit margin. Traders said that investors who had shorted the stock when Nissan slashed its annual profit outlook in November appeared to have started covering their short positions. "The company startled the market last fall, so those who were expecting even worse news at this earnings release were relieved that there was no such negative surprise," said a fund manager at a Japanese asset management firm. Sony gained 2.2 percent and was the eighth most-traded stock by turnover. The Nikkei newspaper said Sony is in talks with Apple to double its supply of camera components for a new iPhone slated to roll out as early as next year. Exporters were generally higher as the dollar edged up to a 1-1/2 week high of 102.71 yen. Canon added 1.5 percent and Panasonic Corp added 1.7 percent. The JPX-Nikkei Index 400, an index launched this year comprised of firms with high return on equity and strong corporate governance, rose 1.3 percent to 11,019.74.